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One Israeli soldier and three Hamas fighters were killed on Friday before Egypt and the UN were able to broker a deal to bring a halt to the escalation.

Hamas said an agreement had been reached “to return to the previous state of calm”. Israel did not publicly acknowledge the ceasefire but officials said a deal had been struck.

While the ceasefire seemed to be holding, the border was not completely quiet. Israel’s military said one of its tanks opened fire on a Hamas observation post after a group of Palestinians tried to break through the border fence in northern Gaza.

No injuries were reported.

It was not clear if the ceasefire deal included an end to the burning kites and balloons which Palestinians have flown from Gaza into Israel in recent weeks.

The incendiaries have caused more than a thousand fires and burned more than 7,000 acres of fields, according to the Israeli military.

More than a thousand fires have been caused by balloons carrying incendiariesCredit:
MAHMUD HAMS/AFP/Getty Images

Israeli media reported that Israel’s government believed the kites and balloons would stop under the deal, while a Hamas official said the ceasefire only applied to direct military weapons like mortars and rockets.

While an immediate escalation appeared to have been averted, Friday’s violence was the second major flare up in a week. Some analysts have concluded that without a diplomatic breakthrough it is only a matter of time before a new war breaks out.

Donald Trump’s plans for “the deal of the century” to try to bring peace between Israelis and Palestinians appears to have been downgraded to more modest proposals aimed at easing the humanitarian situation in Gaza.

Jared Kushner, Mr Trump’s son-in-law and point man on Middle East peace, published an article this week in the Washington Post offering a gloomy assessment of achieving even modest progress in the Mediterranean enclave.

He said there “there is no good option” in Gaza unless Hamas is forced from power or else abandons its core principles and recognises Israel.

“Hamas leadership is holding the Palestinians of Gaza captive. This problem must be recognized and resolved or we will witness yet another disastrous cycle,” he said.